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Empowering Homebuyers: Legal Remedies Against Unfair Practices by Builders

Shruti Goel
August 18, 2023
Legal Remedies Against Homebuyer


Purchasing a home is often considered a milestone achievement, symbolizing stability and security. However, the dream of owning a home can quickly turn into a nightmare when homebuyers encounter unfair practices from builders. Unscrupulous practices such as project delays, misleading advertisements, and poor construction quality can shatter the trust that homebuyers place in builders. In such situations, understanding the legal remedies available becomes crucial.  

In this blog, we will explore the legal avenues that empower homebuyers to seek justice against unfair practices adopted by builders. 

The Real Estate (Regulation and Development) Act, 2016 (RERA) 

RERA is a landmark legislation that has been enacted to safeguard the interests of homebuyers and promote transparency in the real estate sector. It mandates that builders register their projects with the respective state RERA authorities before advertising or selling. This registration requires builders to provide accurate project details, timelines, and financial information. Homebuyers can seek legal remedies through RERA in the following  ways: 

Project Delays: If a builder fails to deliver the project on time, homebuyers can file a  complaint with the RERA authority. The builder can be held liable to pay compensation for the delay. 

Misleading Advertisements: RERA prohibits misleading advertisements and mandates that all project-related information provided to homebuyers is accurate. If homebuyers are misled by advertisements, they can approach RERA for redressal. 

Defective Construction: In case of poor construction quality or structural defects,  homebuyers can raise complaints with RERA. The authority can order rectification of the defects or award compensation to affected buyers. 

Consumer Protection Act, 2019 

The Consumer Protection Act provides a legal framework for protecting the rights of consumers across various sectors, including real estate. Homebuyers can approach the  Consumer Disputes Redressal Commission (CDRC) for grievances against unfair builder  practices: 

Unfair Trade Practices: If builders engage in deceptive practices, such as misrepresenting property features or falsely promising amenities, homebuyers can file a complaint under this act.

Deficiency in Services: Homebuyers can seek compensation from builders if there is a deficiency in services, such as inadequate infrastructure or delayed possession. 

Filing a Civil Lawsuit 

Homebuyers can also choose to file a civil lawsuit against builders for compensation and other reliefs. Some common grounds for filing a civil lawsuit include: 

Breach of Contract: If the builder fails to fulfill the terms of the sale agreement, such as delivering the property as per specifications or timeline, homebuyers can sue for breach of contract. 

Negligence: Homebuyers can claim compensation for losses incurred due to the builder's negligence, such as construction defects leading to property damage. 

National Company Law Tribunal (NCLT) 

In case the builder is a corporate entity, homebuyers can approach the NCLT under the  Insolvency and Bankruptcy Code (IBC) if the builder defaults on financial obligations.  Homebuyers can file an application before the NCLT, seeking the initiation of the corporate insolvency resolution process (CIRP) against the defaulting builder. 


Unfair practices adopted by builders can have serious implications for homebuyers, financially and emotionally. Fortunately, legal remedies are available to empower homebuyers against such practices. The Real Estate (Regulation and Development) Act, the  Consumer Protection Act, the Insolvency and Bankruptcy Code, 2016, and, civil litigation offer avenues for seeking justice and compensation. These legal frameworks serve as a  beacon of hope for homebuyers who are determined to protect their rights and hold builders accountable for their actions. At Ancoraa Resolution, we believe in empowering Homebuyers with the knowledge and support they need to navigate through such challenges and secure their dream homes. 

How Ancoraa can Help Homebuyers? 

Ancoraa Resolution is a financial services firm promoted and managed by experienced  Insolvency Professions with a deep experience in banking, debt resolution, and restructuring. 

Ancoraa Resolution helps suppliers file insolvency applications and get their dues faster by leveraging its technology platform and speeding up the recovery process. With over 35  licensed Insolvency Professionals located across 14 cities in India, Ancoraa Resolution ensures that you are equipped to take speedy action in matters of insolvency, debt resolution, and liquidation. 

Ancoraa’s flagship technology, the Rezolution Engine® – is India’s first and only ‘Resolution as-a-Service’ platform providing a collaborative digital avenue to run the entire resolution process in compliance with the Insolvency & Bankruptcy Code of India. Whether you are a  supplier, a homebuyer, a bank, or a personal Guarantor, Rezolution Engine® enables anyone to initiate an insolvency application and allows all the participants to get a single point of view to the insolvency and bankruptcy proceedings while maintaining compliance and governance throughout the process.  

Ancoraa helps in filing homebuyer claims against builders by filing an application before the Adjudicating Authority in accordance with the provisions of the Code. Initiating your application on Ancoraa website is easy, fast, and hassle-free. One of our licensed insolvency professionals will reach out to you and help you with your claims. The claims of each home buyer under different scenarios depend on the nature of the agreement and on the relief that the Homebuyer is seeking from the court. We further ensure that the Homebuyers claims are submitted within the specified time and Homebuyers have the valuable opportunity to participate in the Committee of Creditors and therefore have the voting right in a class proportional to the financial debt through an authorized representative.

About the author
Shruti Goel

Shruti is the operations specialist at Ancoraa. She is responsible for IP engagement, company research and operational excellence initiatives. She is passionate about and writes on topics of Insolvency Technology and administers Ancoraa’s flagship technology platform ‘Rezolution Engine’.

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